Behind the arrest of Karti Chidambaram is a sordid tale of amb­ition, greed and betrayal at multiple levels—and also the launch of the English news channel NewsX. Intricately woven into its fabric are the threads of shrouded funding and the murder of a young woman who played no part in any of it. There was certainly a lot of the clichéd blood, sweat and tears that went into the founding of NewsX—the sweat of funders who lost money; the tears of journalists who gave up better jobs, only to eventually find themselves all­egedly manhandled and intimidated by goons; and the blood of Sheena Bora, allegedly killed by her mother Indrani Mukherjea, along with her second and third husbands, Sanjeev Khanna and Pratim ‘Peter’ Mukherjea, respectively. The murder featured on prime-time shows with photos and videos of the power couple, news of the sacking of Mumbai’s then top cop, and a man who gave a TV interview, in Calcutta, his face hidden in a motorcycle helmet. Now it has got entangled with a separate conspiracy altogether.

In 1990, leaving her two kids from her first marriage, Sheena and Mikhail, with her parents in Guwahati, Indrani moved to Calcutta, where she married Khanna and founded a headhunter firm. She had another daughter before moving on to Mumbai. She is said to have kept her relationship with Sheena and Mikhail hidden, while sending money for their expenses.

After making money by fiddling with the share value, Indrani and Peter sold their INX shares and moved to the UK.

In Mumbai, she married Peter, and their joint career graph skyrocketed before plummeting sharply. Following news of the marriage, Sheena and Mikhail had reached out seeking help. Sheena, in fact, shifted to Mumbai and lived at some distance from Indrani’s new family, while the daughter from the second marriage stayed with them. An alleged relationship between Sheena and Rahul, Peter’s son from his first marriage, might have queered matters between mother and daughter. Meanwhile, Indrani had transformed from a headhunter into a media baron, with help from Peter, who had changed the fortunes of Star TV, Rupert Murdoch’s first media venture in India.

The big break came after Peter took over as CEO in 1999. On July 3, 2000, Star Plus launched two programmes that became big hits. Kaun Banega Crorepati (KBC), a rip-off of the hit British quiz show Who Wants to Be a Millionaire?, with Hindi superstar Amitabh Bachchan as the host. And Ekta Kapoor’s Kyunki Saas Bhi Kabhi Bahu Thi launched a new genre of soap operas. Star executives began saying their programmes were now competing with each other for TRPs. No wonder there was a rush of advertisers at Star India’s offices. Businessmen, celebrities and soc­ialites were keen to meet the man behind Star’s success and bonds were forged that survived many a storm until Peter was arrested for his alleged role in aiding Sheena’s murder. There are anecdotes in circulation about how and when different businessmen and socialites became friends with Peter and Indrani.

In 2015, additional solicitor general Anil Singh told a CBI court in Mumbai that the probe agency reportedly traced Rs 900 crore to a Singapore bank account in Sheena’s name. It was widely reported that this transaction happened through nine shell companies, but this has not been mentioned in the charge-sheet bec­ause the CBI is still waiting on letters rogatory sent abroad.

The 2009 I-T report says Indrani controlled six companies, besides INX Media and INX News, as on March 31, 2008.

Journalist Manish Pachouly wrote in his recent book, The Sheena Bora Case, “…the amount of Rs 900 crore that as per CBI’s initial assessment was siphoned off by Indrani and Peter through INX Media Pvt. Ltd, using nine shell companies…was parked in Sheena’s account in a Singapore bank.” Pachouly alleges that Sheena ref­used to part with the money in 2012, dem­anding a flat in a tony Mumbai neighbourhood, a car and a diamond ring—perhaps to propose to Rahul.

If the money that founded INX was not Indrani’s to begin with, whose was it and how did she come by it? Income Tax inv­estigators dug into records, past suitcase companies (set up with the sole aim of transferring money from one company to the next in a chain, with the destination company at the end) and cleverly crafted corporate veils to find the answer.

INX Media and INX News have been through three phases of ownership and management, the first being ownership by Peter and Indrani. Outlook has rev­iewed the July 15, 2009 report by the int­elligence wing of the Income Tax dep­artment under the finance ministry. This report, by N.P. Bhagat, then director, Income Tax (Intelligence), clarifies many questions about who originally backed their venture. The probe looked into: “What are the sources of her funds? Who are the entities from whom she has obt­ained these funds? What are the terms of lending? Is she fronting for someone? Is there any benami arrangement?”

The I-T department found the funds had been gathered through both debt and equity. On March 31, 2008, INX News had three shareholders—INX Media, IM Media and Indrani. INX Media, in turn, had nine shareholders, of which three were foreign, who had invested Rs 263.29 crore for equity in INX Media. On the books, INX Media divided this amount as Rs 205.26 crore for share premium, Rs 55.64 crore for share application and only Rs 2.39 crore as share capital.

As per the I-T report, in later communications, the Foreign Investment Promo­tion Board clarified to the I-T department that the entire sum, not just the measly amount booked as share capital, was to be treated as FDI. The three foreign fund­ers—Dunearn Investments, New Vernon PE and New Silk Route—were Mauritian fronts for the Singapore government-­owned Temasek Holdings, US-based New Vernon Capital and two Indian-origin investors who had also invested in a major Indian telecom player of that time.

The CBI traced Rs 900 crore made from INX to a ­Singapore account in Sheena Bora’s name.

As per the 2009 I-T report, apart from INX Media and INX News, Indrani controlled six companies as on March 31, 2008. Shares in each of these companies were held either by Indrani herself or by other companies she owned. To illustrate, Indrani held 99 per cent shares in INX Executive Search, which owned 99 per cent in IM Media, which, in turn, had shares in INX Media as well as INX News.

The I-T probe found that all six companies controlled by Indrani, which had inv­ested in INX Media and INX News, had received substantial loans of Rs 239 crore from three companies—Hitech Dealers (Rs 42 crore), Xanti Commercial (156Rs crore) and Tiara Comtrade (Rs 41 crore)—through loan agreements for adv­ance, interest-free convertible loans.

“The lender has been given the right to convert its outstanding loans (in part or full) into shares at any point,” says the I-T report. “This seems to be an indirect inv­estment in the group by the so-called lenders of unsecured loans…. Such huge unsecured loan is being given without any security and interest and the fact that the lender has been given the right to accept or reject the repayment of the loan raises suspicion of some kind of arrangement to receive indirect investment to the group.”

The I-T probe found that Xanti, Tiara and Hitech had also received loans from other companies. There were common directors on these companies’ boards, including the controlling partners of one of India’s oldest solicitor firms. “Two, i.e., Reliance Gas Pvt Ltd and Reliance Extrusion Pvt Ltd have transferred funds amounting to Rs 159.36 crore to Xanti Commercial Pvt Ltd either on the same day or on a day before Xanti Commercial Pvt Ltd transferred Rs 156 crore to INX Executive Search Pvt Ltd,” says the I-T report. Other transactions also took place in the same way, eventually ending as loans to companies controlled by Indrani. Despite repeated requests, various officials of Reliance MDAG declined to comment.

According to a Business Standard report (Feb­ruary 7, 2007), “Temasek Holdings...is believed to be in talks with a clutch of Indian media professionals and business houses to set up a TV broadcasting company. The proposed company could rope in former Star TV CEO Peter Mukerjea and Mukesh Ambani, the latter through his personal investment companies, as well as some US-based equity funds.”

So far there has been no prosecution based on the SFIO report and the Rs 900 crore is still in the Singapore account.

After INX was launched, journalists complained of Indrani’s interference in editorial operations of NewsX until she sacked five. In his resignation letter, journalist Nagendra Nag noted, “Not only do I question Mrs Indrani Mukerjea’s cred­entials to run a channel, I am also pert­urbed by questions about the source of her funds. She has told the press she owns over 60 per cent of NewsX. Is this her own money, or is she fronting for somebody? I believe an investigation is called for.” Others such as Avirook Sen, then executive editor, had equally noisy exits. It turns out Indrani also wanted the mana­gement to be part of editorial meetings.

After allegedly making money by fiddling with the share value of INX, Indrani and Peter sold their shares to a company owned by Vinay Chhajlani and moved to the UK in January 2009. A 2013 probe by the Serious Fraud Investigation Office (SFIO) upheld the findings of the 2009 I-T probe and where Chhajlani got his seed capital. “Thus, as the evidence unf­olds, the promoter group companies of Reliance advanced funds in the guise of convertible loans only to acquire the ­equity in INX Media and IM Media Pvt Ltd,” reads the SFIO report. “The two companies in turn acquired the equity of INX News Pvt Ltd, which was operating the NewsX channel. Hence, on the one hand, the promoter group companies of Reliance advanced funds to acquire ­equity of INX News Pvt Ltd at a premium and, on the other hand, one of the RIL companies, namely, Aarthik Com­mercials Pvt Ltd advanced funds to Indi Media Co Pvt Ltd through Suvi Info Management Pvt Ltd to acquire the same equity from INX Media Pvt Ltd and IM Media Pvt at Rs 10 per share at par, causing wrongful loss of Rs 168.50 crore to the companies, namely, INX Media Pvt Ltd and IM Media Pvt Ltd and an equivalent wrongful gain to Indi Media Pvt Ltd. Thus, it can be seen that the buyer and seller were one and the same group, that is, Reliance. The maze of companies and web of fund movement was created only to hide the identity of the group and to induce losses in the hands of INX Media Pvt Ltd and IM Media Pvt Ltd and gains at the hands of Indi Media Pvt Ltd as per the premeditated plan.”

Journalist Jehangir Pocha was roped in to run the editorial functioning of the channel. He and corporate lobbyist Niira Radia were regularly in touch. To establish a relationship between Radia and NewsX, SFIO sleuths relied on the “Radia tapes” (published nine years ago by Outlook). “The transcript of the conversation held between Mr Pocha and Ms Niira Radia further reveals that Mr Pocha took care of happenings as per directions of Ms Radia,” says the SFIO report.

Later, the Zee network bought out INX’s entertainment channel in 2010 and the music channels in 2017, which run under the brand 9X, from New Silk Route (now Rivendell). In 2012, NewsX was sold to the Piccadilly group, which is owned by the family of Manu Sharma—who had shot dead model Jessica Lal during a high-profile party in Delhi in 1999. This group holds the controlling share of the news channel and Manu’s brother Kartikeya Sharma runs it as managing director of the India News bouquet of channels.

To its credit, NewsX (and also the Piccadilly-owned Hindi channel, India News) scooped many reports on the Sheena Bora murder probe, with the present dispensation not caring to protect its founders. So far there has been no prosecution based on the SFIO report and the estimated Rs 900 crore siphoned out of the INX companies remains in Sheena’s Singapore account—a legacy of multiple layers of greed and betrayal.